Passive income has been revealed as one of the most effective strategies for all those seeking financial freedom.
Now, are they really effective? Can this longed for financial independence really bring us?
As in everything, it depends on how we do it, what strategy we follow and how we configure it. Not all passive income, by itself, will make us free in the economic. It will be necessary to design our roadmap well. One thing is that one income is passive and another that we can live with it.
By the way, before continuing, does everyone know what passive income is? Those that, as the name suggests, are perceived passively by the owner once configured, constituted or created. In other words, we create the source or origin and we charge. No need for further work or maintenance. Or with very few.
Examples: leases of real estate, financial products, digital assets for sale, products that provide royalties or royalties, etc.
Here we write 7 golden keys to passive income to achieve financial freedom
1. REQUIRE A VERY LOW CONSTITUTION COST
This requirement is not necessary for an income to be passive, but for it to provide financial freedom.
It means that if you spend or invest a large amount of money to report a discrete return, say for $ 50 / month, the income will be passive, once you have constituted, but I doubt that you can live with 50 Dollars monthly.
You have to invest/ spend/use the least amount of money possible to obtain the highest possible returns.
Example: if you have X amount of money, say $ 90,000 for example, it will be more profitable to acquire a property and lease it than to open a fixed-term deposit.
We are talking about profitability. Another thing will be the personality of each one, their fears, idiosyncrasies, fears, etc. See this article: 8 Ways to make money with Amazon
2. HAVE A VERY LOW MAINTENANCE COST
In an analogous sense to the previous one, the desirable thing would be that the entrance required of very little maintenance costs to increase our profitability.
Obtaining stock market dividends can be very comfortable, but involves commission and management costs that may not be so attractive. On the other hand, the costs of hosting a digital product on the Internet, let’s say, can be much lower and provide us with the possibility of higher incomes.
3. OPERATE IN AUTOMATIC OR SEMI MODE
This element is key in passive income. They must work in mode automatic or almost. You must do nothing or almost nothing. And they should continue working and providing benefits, of course.
The key to passive income, unlike the ordinary, is that it takes place without the need for further action once it has been created.
Now, regarding automation, there are some misunderstandings.
Not everything that works on the internet has to be passive. Many of us know that we take hours!
The automatic also has nothing to do with the speculative. They are different concepts. Buy something and sell it more expensive can be very good (or not, I do not know) but it does not have to be an automatic process (if you want to resell a property, for example, you have to advertise, manage, travel, real estate visits, etc. All of which has nothing passive!)
4. BE SEVERAL AND BELONG TO DIFFERENT SECTORS
A single income is difficult to provide financial independence. To enjoy it, there must be several and, for greater security, belong to different sectors.
A single book (a typical example of passive income) is difficult to allow you to retire.
Several yes. If you are good, you have good marketing and are sold, logically.
But there may also come a day when sales decline. So You will want to have other income from other sectors: a leased asset, an online course, a term deposit …
5. ALLOW THE USE OF LEVERS
What is a lever? A mechanism that allows you, with a very discreet effort, to multiple effects, multiple benefits. It’s getting more with less.
The levers, like passive income, can also be configured to suit the consumer. And they are a necessary element to, in our case, make us free, allow us to withdraw. If the income does not allow the use of levers, it is more difficult to get it.
Examples: a digital product can be marketed on the internet through affiliate marketing. That is a lever. Other: A book or ebook that contains the offer of more related products can also work as a lever.
6. BE SCALABLE
That is, to enjoy the quality of being able to grow in sales (and benefits) at a much higher rate than the cost. That is, allow to earn more without investing more, or investing very little in relation to what is earned.
7. HAVE A VERY LONG LIFESPAN
And finally, as is to be expected, an income with a long life will affect us much more than one with a short life cycle.
The cycle can be short either because the product is exhausted or consumed, or because its interest declines. For example, it is not the same to write a book about the keys to happiness (subject valid for any time, time and place) than about the consequences of government measures for this year.